Albes v. Keith, Simmons & Co.

• Decision Date: 02 July 1907
• Citation: 44 So. 693,152 Ala. 452
• Parties: ALBES v. KEITH, SIMMONS & CO.
• Court: Alabama Supreme Court

44 So. 693

152 Ala. 452

ALBES v. KEITH, SIMMONS & CO.

Supreme Court of Alabama

July 2, 1907

Appeal from Chancery Court, Morgan County; W. H. Simpson Chancellor.

Suit by Keith, Simmons & Co. against G. Ed Albes. From a decree in favor of plaintiffs, defendant appeals. Affirmed.

Marvin West, for appellant.

Callahan & Harris, for appellees.

DENSON J.

The Borgeson-Albes Manufacturing Company, a business corporation was organized on the 19th day of January, 1905, with a total subscribed capital stock of 40 shares, of which Peter O Borgeson owned 20 and G. Ed Albes owned 19. The bill avers that Albes was secretary and treasurer of said corporation and that, the enterprise not proving a success from a financial point of view, Albes made over to Borgeson, on the 7th day of September, 1905, all of his holdings in said corporation, thus making Borgeson owner of all the capital stock of said corporation. The bill avers that the consideration to be paid for said stock by Borgeson to Albes was $2,650, payable in monthly installments of $50 each; the first installment falling due 30 days from execution of mortgage. It further avers that on said date (September 7 1905) Borgeson and the said corporation, to secure the payment of the indebtedness of $2,650, executed to G. Ed Albes a mortgage on certain real estate and personal property which is fully described in the bill. The mortgage was duly recorded on the 11th day of September, 1905. It is shown by the averments of the bill that the property conveyed belonged, at the time of the execution of the mortgage, to the corporation. It further appears from the bill that the business of the corporation is that of manufacturing lumber and timber into furniture and selling it. It is averred that the mortgage, so far as the corporation is concerned, is voluntary; that the mortgaged property included a lot of plain and quartersawed oak lumber, a lot of supplies, glue, varnishes, etc., and a lot of tables, of all of which, it is averred, the mortgagor was in possession, and from which it was engaged in manufacturing furniture, fixtures, etc., and that the mortgagee allowed the lumber and supplies, such as glue, varnish, oils, sandpaper, and tables, to remain in the mortgagor's possession, to be utilized and to be made up and disposed of during the course of trade, shielded and protected from the creditors of the corporation. It is shown by the terms of the mortgage that the mortgagors are to remain in possession of all the property, and that on default in payment of the indebtedness secured thereby the mortgagee has the power, after notice given, to sell the property to the highest bidder for cash. The creditors of the corporation (some of whom...